Archive · 19 Sep 2025
Expert Insights: Debt Investment Strategy Amidst Rate Cuts
The US Federal Reserve has cut interest rates, and the Reserve Bank of India (RBI) may follow.
This could boost the stock market but changes the game for debt investments.
When rates fall, older bonds become more valuable, and their prices rise, but yields decrease.
Experts suggest focusing on mid-tenure bonds for better yields and potential gains.
Also, investing in gilt funds and corporate bond funds could be beneficial.
Consider your personal risk appetite and investment goals.
US Fed reduced rates, signaling possible future cuts.
RBI may cut rates in response, impacting Indian debt markets.
Bond prices rise as interest rates decrease.
Mid-tenure bonds may offer attractive yields and gains.
Gilt and corporate bond funds could be profitable options.
- Who
- Nikhil Aggarwal, Murthy Nagarajan, Abhishek Bisen
- What
- Debt investment strategies during rate cuts
- When
- As US Fed and RBI consider rate cuts
- Where
- Indian Debt Market
- Why
- To guide investors on navigating the changing interest rate environment
- RBI Repo Rate (August)
- 5.5%
- US Fed Rate Cut
- 25 basis points
- Bond Price/Yield Relationship
- Inverse
- Spread between 10- and 40-year Govt Securities
- 80 basis points
Sources
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